Refinery fuels costs have endured an unsteady course since 2005.
As shown in the accompanying table, most of the Petroleum Administration Defense District (PADD) residual fuels’ increases in cost occurred during 2005 and 2007 for all of the five districts. PADD 4 experienced the least variance while PADD 5 incurred the highest variance in price over the period.
The cost for natural gas for refinery usage increased a fair amount through 2005 and then varied during 2006 and decreased in 2007. These conclusions are based on costs of an average refinery fuel consisting of 1 bbl each of PADDs 1-5 and an average US cost of 4.4 MMscf natural gas (a 1 bbl equivalent on a BTU content basis).
Raw residual fuel oil and natural gas prices come from publications put out by the US Department of Labor.
Biggest variations occurred in PADDs 1, 3, and 5. PADD 4 increased over the period in yearly average to 1,857.9 from 933.1.
While PADD 1’s 3-year averages started with 1,185.4, they increased to 2,113.7 and then to 2,247.2.
All indexes shown are based on 1956 = 100, the basis of the Nelson-Farrar Operating Index for an average US refinery.
Click here to download a .pdf of the Itemized Refining Cost Indexes
